Wednesday, 12 December 2018
Ceisteanna ó Cheannairí - Leaders' Questions
Brexit will be damaging to the Irish economy, the British economy and Europe in general. Therefore, we must do everything possible to limit the damage through thorough preparations in order to make the country infrastructure-ready, particularly at ports and airports. We must also make interventions to assist companies to deal with fluctuations in sterling and to diversify and reduce their dependence on the UK market. Yesterday, I raised here a number of questions with the Taoiseach on our state of preparedness for a no-deal Brexit or even an orderly Brexit, which is what we hope for. According to the Government's data and that of its agencies, however, too many companies with the potential to suffer the greatest impact remain without Brexit plans or have not engaged sufficiently with the various Brexit-preparedness initiatives. The AIB Brexit sentiment survey of 1 November indicates that a substantial number of companies have simply not engaged and do not have any Brexit plan. In fact, the proportion of exporting companies with plans for Brexit is as low as 30%, which must be of huge concern.
I note the 3,000 applications for positions with Customs and Excise. Can the Taoiseach say how many customs officials will be in place on 29 March and working at their desks? The Dutch Government has already hired 1,000 customs officials. Can the Taoiseach outline the work required on infrastructure at our ports and airports? I draw his attention to an article published in the Irish Examineron 28 November 2018 and setting out the content of a leaked memorandum which had been brought to Government by the Tánaiste. The memorandum warned that a variety of challenges had arisen with the potential to impact on the country's capacity to be Brexit-ready. The memorandum sets out risks associated with site acquisition, potential lease-break rental options, statutory planning, procurement and construction issues at the ports and airports which will be most affected by Brexit. Ministers were warned that the scale of the problem facing the State is exceptional. The memorandum states, "In the case of Brexit, the scale and likely cost of infrastructure required, and the short time frame required to gear up for Brexit are exceptional and fall well beyond the routine demands of the State, especially in the case of our ports." The memorandum further warns Ministers of detailed plans on the upgrading of Rosslare Harbour, Dublin Airport and Dublin Port. Significant issues were identified regarding the capacity of Rosslare to be ready by 29 March 2019. The memorandum also details specific site issues at Rosslare.
A number of issues arise. I will make the same point I made yesterday. There has been a general tendency on the part of the Government to be coy and to withhold information from the public on contingency planning for Brexit, specifically a no-deal Brexit, on the apparent basis that it would cause undue panic. I disagree with that view and believe the public should be made fully aware of all the implications of Brexit, irrespective of the scenario that ultimately emerges. The challenges and lack of preparation for Brexit should be shared with the public in full. We should not have to rely on the high standard of investigative journalism so evident in the Irish Examinerto make this basic information available. I ask the Taoiseach to commit to the publication of a detailed plan, including timelines, costs and challenges at our ports and airports, and to publish it without delay.
I thank the Deputy. He is correct to say Brexit, particularly a no-deal Brexit, will be damaging for our economy. However, it is worth noting the ESRI projections released this morning. The ESRI states:
The Irish economy looks set to register another exceptional performance in 2018; employment is growing at 3 per cent with taxation receipts across most headings also experiencing better than expected returns. The ESRI’s latest Quarterly Economic Commentary states that GDP is expected to grow by 8.2 per cent in 2018, followed by 4.2 per cent growth in 2019 [...] Our forecasts for 2019 are subject to the technical assumption that the UK's continued membership in the EU will effectively remain in place after March 2019. However, the economy faces an unprecedented degree of uncertainty in 2019; the outcome of the Brexit process, combined with the possibility of increased international trade tensions, could have significant implications for the economy’s performance in the new year. In the Commentary, we illustrate how a Brexit scenario, where WTO tariffs would apply, could almost halve the growth outlook in 2019.
As such, the analysis of the ESRI is that even in the event of a hard Brexit in which World Trade Organization, WTO, tariffs apply, the economy would still grow next year, although the rate of that growth would be slower. The economy would not go into recession. It is a very reassuring analysis and projection from the ESRI, but it is something we cannot take for granted. The ESRI projection that the Irish economy will grow, albeit at a slower rate, is because our economy is so strong that it will continue to grow and not go into recession even in the event of a hard Brexit next year. Even so, we cannot take anything for granted or assume that the ESRI projections are necessarily correct.
This morning, I had the privilege to open the new European headquarters of Barclays Bank on the site where the Passport Office used to be located. the road, the new headquarters of Barclays Bank. This means that every branch in Europe will now be a branch of Barclays Bank Ireland on Molesworth Street. The bank is going to employ 400 people when fully staffed and will have a balance sheet of €250 billion based here in Dublin. This is an example of what is happening in the wider economy. While there are huge downsides to Brexit, particularly for SMEs and the agrifood sector, money and jobs are also coming into the country because people know Ireland is a good place to do business. That is because our economy is strong, we have a good education system, a favourable tax regime for companies, pro-enterprise policies and a political consensus in that regard across the House and because we know our position is at the heart of Europe no matter what happens anywhere else.
The Taoiseach did not answer even one of the questions I asked. I have read the ESRI report and am fully aware of our open, foreign direct investment-based economy, which has been successful and effective for 40 years. Our decision to join the European Union is one about which I have always been enthusiastic as one of the great game-changers historically for Irish society. Certainly, I would not be complacent about a WTO-type Brexit and I consider that the impact for the agrifood section in particular will be very difficult. There is no point pretending. It will be very difficult for the Border counties. The Government's own economic analysis from the Department of Finance and the Copenhagen report point to severe difficulties for the agrifood sector and the Border counties. My basic question to the Taoiseach related to the number of customs officials who will be in place by 29 March 2019. I asked if he would publish a detailed plan outlining the challenges, work to be done, timelines for doing it and the cost of works at Dublin Port, Rosslare Harbour and our airports.
Will the Taoiseach confirm that the detail and content of the Government memo that was brought by the Tánaiste and revealed in the Irish Examineron 28 November truly reflects the case?
Firms across the country are preparing for Brexit. Some 85% of Enterprise Ireland firms have a Brexit plan already. That is important because Enterprise Ireland firms are the firms that are doing the exporting.
Some 85% of them have a Brexit plan in place already. Generally speaking, IDA firms know what they are doing. They are the multinationals which invest here in Ireland. We need to improve preparedness, however, particularly among small and medium enterprises, SMEs, that export to the United Kingdom. Seminars are available. They are happening all over the country and assist businesses to become Brexit-ready. The Deputy will have heard some of the advertisements on the radio prompting people in business to do exactly that. Customs training is available and we have also made low-cost loans available to business.
On the Deputy's question about customs officials, we have a panel of 3,000 people who have applied to be customs officials. A minimum of 200 will be in place in March but that can be increased to a much greater number should we find ourselves in a hard Brexit, no deal scenario. The comparisons with Holland, and with Rotterdam in particular, are not valid. Rotterdam is a massive port which handles ten times as much trade as our Irish ports, so obviously the numbers in Rotterdam are going to be much greater than those required in Dublin and Rosslare.
In terms of making information public, we are very happy to give the Deputy full briefings and information through the Brexit stakeholders' group. We will publish plans, but it must be borne in mind that this situation is still evolving. Brexit planning happens on two levels. Most of it is led at a European level from Brussels. Some 70 notices have been issued already. The final seminar at European level will only happen on 10 January. Our domestic preparedness comes in under that. Any plans we produced now would have changed again by the middle of January. We will do that.
I spoke with the British Prime Minister last night and reiterated the common position of all of us here, which is that the basic protections afforded to Ireland in the withdrawal agreement, particularly the backstop, are non-negotiable and cannot be unpicked or diluted. I spelled out to her the need to ensure that the commitments agreed in last December's joint report by British and EU negotiators are honoured. That means no hardening of the Border on the island of Ireland, that citizens' rights are protected, and that the Good Friday Agreement is upheld in its entirety.
In December the Taoiseach said that he had a cast-iron guarantee. He said that he had "achieved what we sought to achieve" in respect of avoiding a hard border. He said what we had was "rock solid" and "politically bulletproof". In the midst of the deepening crisis at Westminster I am afraid to say that those words no longer hold. On Monday Mrs. May shelved her plan to hold a vote on the withdrawal agreement at Westminster and today she faces a vote of no confidence in her leadership. That is a matter for herself. What we need to be concerned with and what is our business is ploughing our furrow.
On the concerns around our ports and around investment in them, I am glad that the needs of Rosslare have finally dawned on the Taoiseach. The need for sectoral planning is unanswerable. We also now need to look at any prospect of a no deal scenario or crash come March. I will emphasise that this is not something anybody here, including Sinn Féin in particular, wants to see. When I and others asked the Taoiseach yesterday about contingency planning for a crash scenario, he said "preparations involve a number of elements including the hiring of staff such as customs' staff, veterinary inspectors [and] environmental health inspectors". That is all very well and good but, as we all know, a crash-out Brexit would be catastrophic for our island. It would rupture our economy, our social fabric, and our peace accords. The contingency planning required therefore goes well beyond the recruitment of additional officials.
I reminded Mrs. May last night that, in the event of a no deal situation arising, it is the strong view of Sinn Féin that a referendum on unity must be advanced as a matter of urgency and priority. Of course she disagrees with that because she is a unionist. That is fair enough, but the Taoiseach is Head of Government here. He should accept that Irish unity is the logical, sensible option to avoid the calamity of a crash or no deal scenario and everything that would entail for our island in the short and long term. I put it to the Taoiseach that in a situation in which the Good Friday Agreement is to be disregarded, a crash situation, we need to go back to the agreement and its provisions for a referendum on Irish unity. Giving the people their say would be the ultimate contingency plan.
The Deputy correctly quoted what I said in December on the joint report and on the agreement we struck between the EU and the UK last December. I also said that we had to be vigilant and that we would be. We have been. I also said that the next step was to turn that joint report we agreed last December into a legally binding withdrawal agreement. For months and months I heard critics in this House tell me and the Government I lead that we oversold the deal that was made in December. We did not. It, including the Irish protocol, was translated faithfully into the legal text of the withdrawal agreement as we promised would happen. The next step is to secure ratification by Westminster and the European Parliament. That is still possible. That is what we are working on now. We will have a meeting of the European Council on Thursday and Friday. It will be an opportunity to engage with Prime Minister May and for me to speak to my colleagues. Indeed I will be taking a call from President Juncker later today to see what assurances we can give the United Kingdom Parliament that might assist it in ratifying the withdrawal agreement. That cannot mean a change in the substance of that agreement, including the substance of the protocol on Ireland and Northern Ireland, however. That is what we are going to work towards.
I do not believe that now is the time for us to start talking about Border polls. I understand the perspective of the Deputy's party, which is committed to the territorial unity of this island. That is an aspiration that most of us in this House share but this is not the time to go about it. There are people in Northern Ireland who know that the backstop is a good deal for them. That is why it is being supported by business, farmers and many civil society organisations in Northern Ireland. To now inject a constitutional dimension into this debate would be destructive and disruptive because there are people who are arguing against this agreement precisely because they believe that having special arrangements around regulations for goods somehow weakens the union between Northern Ireland and Great Britain. We know that is not the case. There are many special arrangements for Northern Ireland already. In so many areas, from social policy through to agricultural regulations, Northern Ireland is already different from Great Britain. Another example is that, before the institutions were brought down, they were seeking autonomy over corporation tax. Northern Ireland can have differences and still be part of the United Kingdom just as there are differences between all the countries in the European Union. I really do not believe that stirring up tensions in Northern Ireland or turning this issue into one of orange versus green is at all helpful at this time.
I agree with the Taoiseach that would not be a helpful thing to do. As he well knows, that is something which we have not done. In fact, considerable and very fruitful efforts have been made to ensure cross-community and cross-party support for a consensus against Brexit in the North. Brexit is a British Tory invention. All this disruption and tension is not of our making or of the making of anyone in this House. It is of the making of the Tories across the water.
The Taoiseach talks about relying on a vote at Westminster and the safe passage of the withdrawal agreement. That may or may not occur. Let me emphasise again that I want to see a crash no more than the Taoiseach does. However, I also want to say to the Taoiseach, as Head of Government with the responsibility to advance Irish national interests and to protect everyone on this island, North and South, east and west, that he now has to plan and prepare for such an unfortunate scenario with eyes wide open. Rather than evading his responsibilities by talking up disruption or disruptive forces, he needs to look this dilemma squarely in the eye.
If there is a no-deal Brexit, all bets are off as regards the Good Friday Agreement. All bets are off in terms of economic prosperity, social cohesion and solidarity. Rather than advancing this plan as something that is hostile to any of our people, the Taoiseach needs to understand it as an absolute necessity. In the event of a crash, we need a strong, robust plan B. The only viable plan B is the removal of the Border – the removal of the gash across our island. Has the Taoiseach planned for this contingency? Are plans under way? People need to hear reassuring words from him that he is planning in accordance with the Good Friday Agreement to allow people the opportunity to make a call, ultimately, perhaps between the union with Britain and membership of the European Union?
We are trying to avoid a scenario in which the UK, including Northern Ireland, crashes out of the EU. That means ratifying the withdrawal agreement which the EU and the UK Government agreed. Twenty-eight Governments have signed up to that agreement. The best thing the Deputy can do to avoid that scenario occurring, and to avoid disruption to businesses and the loss of jobs, particularly in Northern Ireland and the Border counties, is for Sinn Féin to take up its seats in Westminster and vote for that withdrawal agreement.
-----hypothetical scenarios, the best thing the Deputy can do is to do what she can do – take her party’s seats in Westminster, vote for the withdrawal agreement, get the Assembly meeting again and establish an Executive in Northern Ireland.